Foreclosure Auctions

Q: I’ve never attended a real estate auction; how does the process work?
A: Buying real estate at auction is a very simple process. However, it is important for you to be informed and prepared prior to auction day. You should inspect the property prior to bidding on the property during one of the scheduled preview dates.

Q: How are auctions conducted?
A: Most real estate auctions are conducted with open bidding. When you are ready to bid hold up your bidder card and call out your bid, or tell one of the Hudson & Marshall bid assistants the amount you want to bid. See Buying at Auction for more details.

Q: What are the advantages of buying real estate at auction?
A: Buying real estate at auction allows you to experience a quick purchase and closing, eliminates lengthy negotiations, and provides the assurance the price paid was market value.

Q: Are there any back taxes or liens against the property?
A: Unless otherwise stated in the Terms & Conditions for the specific Auction, there are no back taxes or liens against the properties.  Each property will be conveyed by special warranty deed, and title insurance is provided by the Seller.

Q: What do I need to do to register for the real estate auction?

A:Registration is free and can be done at the registration table on auction day. You MUST register to receive a Bidder Card in order to bid.  During the registration process, our agents will need to see:

1.  Valid, government issued photo ID

2.  Certified funds required (see auction terms and conditions)

3.  Proof of Funds to close  (if paying cash, your bank statement;  if obtaining financing, a loan commitment document)

4.  Articles of incorporation, trust documentation or other proof of signing authority (only for those taking title in a company name or trust)

5.  If you are bidding on behalf of someone else, you will additionally need his / her full name, addressed and a notarized power of attorney authorizing you to bid and execute documents on behalf of the actual purchaser.

If you are the highest bidder for a property you will be required to make an earnest money deposit on auction day, a portion of which must be cash or certified funds.

Some auctions do have specific requirements for registration and so we encourage you to refer to the Terms & Conditions for the specific auction you are planning to attend.

Q: What do the terms “reserve” and “absolute” mean?
A: An auction where the property is being sold with a “reserve” means that the property is being sold subject to seller approval. The seller reserves the right to accept, reject or counter the final bid.

Properties identified as “absolute” are sold to the highest bidder regardless of price on auction day only.

Q: What is the minimum bid?
A: The audience begins the bidding so there are no set minimum bids. Properties offered online prior to the auction do not impact the minimum starting bid.

Q: Do I have to make a down payment at the auction?

A:You are required to place earnest money on the contract at auction in the form of certified funds.  The exact amount of earnest money required varies by each auction.  Please refer to the Terms & Conditions of the specific auction for the exact amount of required funds.

Q: Is my deposit refundable if I change my mind after the sale and decide not to buy the property?

A: No. If a buyer does not close for any reason on or before the closing date, the initial deposit may be forfeited.

Q: Why are properties sold at auction?

A: Owners make a business decision to sell property in a one-day sale rather than continuing to incur carrying costs. Sellers are motivated to sell and offer you an opportunity to purchase desirable property at the best price.

Q: How do I inspect the property?

A: Many of the properties will be open for inspection on the dates and times listed. However, some properties will be shown by appointment only. Please contact the individual broker; they are available to answer property-specific questions and open house viewing questions. Contact information for a specific properties broker is listed in the auction brochure and along side the property details on this website.

Q: Can I use a broker?

A: Any real estate broker or agent, may represent you at the auction. They are compensated on average of 1% and are required to perform the following duties:

1. Inspect each Property with client,
2. Remain with client through the execution of all necessary documentation during the entire Auction and post-Auction process.
3. Be present at the Live Auction with client. (must sign in on each day of the Auction and identify client at that time.
4. Must accompany and remain with client throughout the entire bidding and purchase process at the Live Auction, and participating Brokers/Agents will be required to sign the purchase documentation by electronic means, along with their client, within 24 hours of the client receiving the emailed documentation signing link.  Any Registered Broker/Agent who fails to sign the purchase documentation within the time prescribed shall not be entitled to any commission.  Commissions will be earned and paid upon closing.

You are not required to have a broker in order to bid at the auction, but due to the complexity of this type of transaction it is highly recommended.

Q: Is financing available?

A: Some auctions have financing available while others do not. See the specific auction details to determine the availability for the auction you are attending.

Occassionally some properties will quality for special financing through the  sellers.  When this applies, it will be noted on the property details.

All contracts are cash contracts and not subject to the availability or eligibility for financing.

Q: Can I buy more than one property?

A: Yes. You just need to bring and present a separate cashier’s check for each property you intend to purchase.

Q: Do I have to make any more deposits other than my initial deposit before closing?

A: The earnest money deposit collected at auction should be the only deposit required prior to closing.  The amount of money required for the earnest money deposit is detailed out in the Terms & Conditions for each specific auction.

Q: To whom do I talk to if I don’t understand the auction contract?

A: It is very important for auction buyers to be educated and informed regarding the real estate auction process. Make sure all your questions and concerns are answered before you attend an auction. Feel free to have your legal advisor review the contract prior to the sale. However, please note that the seller does not permit additions or changes to the form contract.

Q: Is the amount I bid the total price I will pay?

A:This answer will be found within the Terms & Conditions for the specific auction you are attending.  In most cases, a Buyer’s Premium will be added to your high bid amount to determine the final purchase price. The Buyer’s Premium is typically a percentage of the high bid amount.

Q: What happens once I have become the successful high bidder?

A: In the auction room, you will be provided with a Bid & Deposit Receipt and your certified funds will be collected.  You will then move to the contract table where you will complete the Purchase & Sale Agreement for the property.  Agreement examples are available the day of the auction.